October 25, 2018

Three years ago McDonald's began copying the path Burger King had already beenon for several years - financial engineering and refranchising.Since Wall Street believes the McSpin, Burger King is now copying McDonald'sdigital strategy - not because it works - because it impresses investors."Burger King Of Tomorrow" or BKOT?Burger King’s owner plays 'catch-up' on technology.

October 24, 2018

This is a super legitimate point.
Just about every major QSR chain in the publicly traded universe has unloaded nearly all of their stores on franchisees. And then they discount the hell out of the menu even as labor costs skyrocket.

Jonathan Maze added,

Barbarian Capital@BarbarianCap

Replying to @BarbarianCap@jonathanmaze

and what really irks me is that there is a borderline fraudy element: you induce franchisees to sign up based on certain profitability expectations, and then you keep slamming them w discounts

October 18, 2018

"During this past quarter, Del Taco found weakness in its bargain $1 Chicken Quesadilla Snacker, which drove customers into the store but failed to pay off in sales for the brand."Del Taco Shifts Value Menu Focus.

$MCD just let franchisees push the ETOF remodel for their restaurants by 1 year (into 2020) if their restaurant was recently remodeled. Let’s operators get 1 more year out of a location which decor may only be 2 yrs old (& still may be paying off that CAPEX). Great move https://twitter.com/mcd_truth/status/1038075035557212160…

Today I addressed a meeting of over 300 McDonald’s franchise owners gathered in Tampa, Florida, who are seeking to work with McDonald’s to positively impact the system for the benefit of all franchisees, McDonald’s company, its shareholders, and ultimately the customers.

October 9, 2018

If you've taken my advice to read John Love's book "McDonald's: Behind The Arches" you'll remember the last several pages of the original book focuses on Fred's dream of having McDonald's Operators and suppliers own a large chunk of McDonald's stock.At the 1986 Worldwide Fred told the convention, "I own some of your store, now I want you to own some of mine".The book says this effort was about making the company more entrepreneurial. Maybe it was but there's a back story. McDonald's was a darling of Wall Street and management was concerned that outside investor groups or hostile entities would someday control enough shares to have a major influence on how the company operated. Putting 20/30/40% of the shares in the controlof McDonald's Operators, suppliers, and company employees could prevent that from happening. The three-legged stool would be able to protect the company.Protect it from what? Investors who didn't understand the culture of the system. Greedy investors who wanted to take excessive cash out of the company. Shareholders who didn't understand the need for solid, productive franchisees.But now, five years after his passing, Fred's fears have been realized. It happened from the inside, not by outside robber barons.The company and the Operators have been stripped mined to return cash to MCD shareholders. The culture has been changed or erased by individuals who don't know what made the system successful. Franchisees are considered liabilities not an asset.The McDonald's board of directors was once peppered with executives from some of the major system suppliers. Those folks are gone and the board is made up people with no history with, or connection to McDonald's.Only McDonald's Operators can fix McDonald's because they are the only people left who remember how McDonald's is supposed to work..